Finnish forestry products giant to start producing bio fuel

New companies jump on the bio diesel and ethanol bandwagons every day, but this one's worth noting.

UPM-Kymmene Corporation of Finland has announced plans to "strongly increase" its stake in second generation bio diesel in the next few years and become a significant producer of bio fuels.

UPM is one of the world's leading forest products companies. The group's sales in 2005 were EUR 9.3 billion, and it has about 30,000 employees. Forestry is big business in Finland, where 86 per cent of the country is covered by trees.

UPM's main products include paper and other wood products, so you can imagine they generate a fair amount of biomass byproduct.

Currently, the company is still working on the business technical details. It plans to build a major plant adjacent to one of its paper mill sites in Finland, France, Germany or UK.

"Investments in development of concepts and plants will be significant. The production of bio-fuel is a good fit for UPM since its core business is to add value to the wood raw material. Our aim is to maximise the gain from the biomass-based raw material," said Jussi Pesonen, President and CEO.

"The importance of renewable fuels is increasing, and we consider this an opportunity to further utilise our existing value chain and be part of the future development."